Vanguard Group has appointed a former BlackRock executive as its new leader, marking the first time in its roughly 50-year history that an outsider will lead the asset manager.
Salim Ramji, who previously led BlackRock’s exchange-traded funds and index investing until earlier this year, is set to become Vanguard’s chief executive in July, the company announced late Tuesday. The Wall Street Journal had previously reported that Ramji’s appointment was imminent.
Ramji left BlackRock in January after about a decade with the firm, stating at the time that he intended to “seek a new leadership or entrepreneurial opportunity outside the firm.” He is widely credited with expanding BlackRock’s iShares ETF business, which manages trillions of dollars. In his final position, he oversaw two-thirds of BlackRock’s assets under management, totaling more than $10 trillion.
Headquartered in Pennsylvania, Vanguard announced in February that CEO Mortimer J. “Tim” Buckley would be stepping down, initiating a search for his successor. Concurrently, the company promoted Greg Davis, formerly Vanguard’s chief investment officer, to the role of president.
In its latest move, Vanguard has appointed both Ramji and Davis to its board and named Mark Loughridge as its nonexecutive chairman.
Ramji will make history as Vanguard’s first chief executive who did not directly collaborate with the late founder, John C. Bogle. Bogle founded Vanguard in 1974 and introduced the world’s first index mutual fund in 1975. Following his passing in 2019, a dedicated community of customers, known as Bogleheads, continued to support his legacy.
Ramji initially joined BlackRock in 2014 to lead corporate strategy. In a LinkedIn post regarding his departure earlier this year, he disclosed that he had initially turned down an opportunity with the investment giant to explore the possibility of leading a smaller firm. Despite his achievements at BlackRock, he eventually realized that he "yearned for the road not taken."
At Vanguard, Ramji will assume leadership of an organization that is second only to his former employer in scale. While Vanguard has excelled in attracting new assets, it has faced challenges along the way, including technological issues and customer service complaints related to its brokerage platform.
The firm is seeking to diversify beyond its core business of managing low-cost funds that track stock and bond indexes, aiming to enter the more lucrative field of providing financial advice for a fee.
Vanguard does not publicly disclose its financial performance. Unlike many of its rivals, the company is owned by its funds, a structure it maintains in order to pass profits on to shareholders through lower fees.
Jack Pitcher contributed to the reporting of this article.